Given the debt obligations associated with his $44 billion acquisition of the business, Elon Musk is arguing that his drastic cost-cutting at Twitter is vital for the social media service to survive in the upcoming year.
Musk described the company to a late-night audience on a Twitter Spaces call on Tuesday: “This Company is like, basically, you’re in a jet that is heading towards the ground at great speed with the engines on fire and the controls don’t work.”
Elon Musk had earlier on Tuesday stated that he intends to continue serving as Twitter’s CEO until he is able to identify a suitable candidate to take his place.
After millions of Twitter users demanded that Musk resigns in a vote the billionaire himself designed and vowed to follow, Musk made his announcement.
“As soon as I find someone stupid enough to take the job, I’ll step down as CEO!” Musk Tweeted. “After that, I’ll merely be in charge of the servers and software teams.”
Musk’s tenure as CEO of the San Francisco-based social media network has been characterized by hastily announced rules and policies that are frequently retracted or altered shortly after being made public.
Musk stated on Tuesday that he “spent the last five weeks slashing costs like crazy” and attempting to establish a stronger premium subscription business since, in the absence of those efforts, Twitter might be operating with a $3 billion negative cash flow next year. He laid some of the responsibility on the $12.5 billion in debt stemming from his April agreement to purchase the business as well as the recent interest rate increases by the Federal Reserve.
Musk’s activities have alarmed Twitter advertisers and alienated users in some cases. In order to address hate speech and other issues on the platform, the business established a council of trust and safety advisors in 2016. Since then, he has fired more than half of Twitter’s staff, dismissed contract content moderators, and abolished the council.
Due to worries that Twitter is stealing too much of his attention and possibly insulting devoted fans, the CEO of Tesla has also alienated investors at his electric vehicle company.
Tesla shares are falling, which is even more unsettling for investors.
Since Musk took over Twitter on October 27, Tesla shares are down 35%, costing investors billions of dollars. On April 1, the final trading day before Musk announced he was accumulating Twitter shares, Tesla’s market capitalization was over $1.1 trillion. Since then, the firm has lost 58% of its value at a time when other automakers are challenging Tesla’s monopoly on the selling of electric vehicles.
As they have every day this week, shares decreased on Wednesday.
Tesla shares, which were initially over $400 each, are currently available for less than $140.
On the Twitter Spaces call, Musk made an effort to defend some of his most recent Twitter actions.
Musk stated that sometimes they “may seem spurious, strange, or whatever.” “It’s because we are currently doing an emergency fire practice. That is the cause. Not because I’m impulsive by nature. I don’t intend to be impulsive naturally, at least not in my ideal world.
Musk, who also runs the rocket business SpaceX, has previously emphasized how challenging it will be to find a replacement for him as CEO of Twitter.
This week, when joking with his Twitter followers, he claimed that the person taking his place “must like pain a lot” to oversee a business that has been “in the fast lane to bankruptcy.”
“No one wants the position that can genuinely maintain Twitter’s existence. No successor exists, Musk tweeted.
As it stands, Musk would continue to have a significant amount of control over the platform because he owns it. Soon after assuming control, the board of directors was removed.
